Recently, there has been a kind of backlash against “strategic philanthropy.” The term has come to take on some very negative connotations, conjuring up images of arrogant, overpriced consultants and their large foundation clients issuing top-down edicts that are ineffective and divorced from the realities nonprofits face.
Strategic philanthropy, in this conception, is seen as overly formulaic and linear, denying the complexity of the tough, interdependent challenges foundations and nonprofits try to address. Moreover, feedback from grant recipients is usually absent, because the idea is that the donor knows best.
Maybe it’s not surprising, then, that even prominent proponents of strategic philanthropy are having second thoughts. Hal Harvey wrote a much-discussed mea culpa that was published earlier this year by The Chronicle of Philanthropy (“Why I Regret Pushing Strategic Philanthropy,” April 4).
“As co-author, with Paul Brest, of Money Well Spent, a handbook on strategic philanthropy, I sometimes feel I owe the world an apology,” Mr. Harvey wrote. “The book’s ideas and arguments are important and legitimate, but I did not properly anticipate the potential side effects of this concept, and some of them are nasty indeed.”
With this and other, similar commentaries, many in the nonprofit world breathed a collective sigh of relief, quick to celebrate the demise of strategy. Indeed, some seem to be virtually dancing on its grave. Strategic philanthropy? As out of fashion now as MC Hammer-style parachute pants.
But we would argue that the issue is not with the “concept” of strategy. It’s with strategy misunderstood, misconstrued, and misapplied.
Dire Consequences
The origins of the problem lie in a frequently cited 1999 Harvard Business Review article, “Philanthropy’s New Agenda: Creating Value.” Authors Michael Porter and Mark Kramer urged foundations to focus on “unique positioning” and “unique activities” and on selecting “the best” grantees in the manner of “investment advisers in the business world.” That article, and others over the years by other authors, import to philanthropy notions that make sense in a competitive context but are quite counterproductive in a noncompetitive one in which the ultimate goal is impact, not profit.
Sadly, many foundations diligently and uncritically worked to carry out strategy just as the article described it. The consequences of the too-frequent adoption of this isolated, top-down, and frequently consultant-driven approach have been many and dire. In his Chronicle piece, Mr. Harvey writes of the tendency, for example, of grantees to contort themselves to fit into foundation-defined strategies that, all too often, aren’t sound.
But let’s not kill strategy just yet. Bad strategy, yes, by all means. Maybe even the term “strategic philanthropy,” which is now laden with so much baggage that it often seems to crush the souls of those in the room when it is mentioned. But we need good strategy in philanthropy. After all, what will replace it? Random, uncoordinated acts of philanthropy? What is the rallying cry for that? “Long live chaos and ineffectiveness!” That’s not one we want to get behind.
The reality is that good strategy is vital. It is underneath and behind every great philanthropic success — from the response to the tuberculosis epidemic a century ago to recent progress in reforming the criminal-justice system. As longtime proponents of strategy in philanthropy, we would argue that it is, in fact, as important as ever — more so, even, because as philanthropy’s scale increases with every newly minted billionaire, so, too, do the consequences of ineffectiveness.
We see strategy in philanthropy differently than those who come out of business. Indeed, we do not see it as a business concept, because it isn’t one. We see strategy in philanthropy as a set of logical hypotheses about how to achieve a goal — hypotheses that guide decision-making and, importantly, learning. As we have both been saying for decades to anyone who would listen, sound strategy in philanthropy is much harder, and plays out differently, than sound strategy in business, for several reasons:
Any sound philanthropic strategy recognizes that many players are needed. In business, you want your strategy to be yours alone; in philanthropy, that is a recipe for failure. Grantees and others close to the ground will have better insights about what is likely to work than a foundation program officer. You need to align your strategy with other grant makers, but also with nonprofits and sometimes officials in government, business, and elsewhere.
Good philanthropic strategy recognizes the effects of complexity and uncertainty. When working on our most difficult societal problems, much is unpredictable. As one of us (Patti Patrizi) and colleagues noted in an article in The Foundation Review a number of years ago, “Much of the knowledge needed to support strategy can arise only during implementation. For example, how organizations react to each other’s new initiatives will surface only over time. Although some dynamics of change in a system might be ‘knowable’ before strategy launch, much of what needs to be learned about these dynamics depends upon actual experience.”
Being good at strategy requires being good at learning. As that article also noted, “Foundations have not cracked the nut of how to learn about, adapt, and improve strategy in ways commensurate with their potential to meet their strategic aims.” Put another way, a philanthropic strategy should never be seen as “fixed.” It is constantly evolving based on learning, listening, and changes in context that affect the problem foundations and nonprofits are trying to solve.
Getting It Right
It’s amazing what can happen when foundations get the approach to strategy right. Believe it or not, that does happen.
The work of the Gill Foundation, the Evelyn and Walter Haas, Jr. Fund, and other groups that came together in the Civil Marriage Collaborative is a stunning recent example of the payoff of strategy done right. It exemplifies all three of the dimensions we mention above. A group of foundations and nonprofits worked in a coordinated way, behind a shared strategy. They recognized the complexity and unpredictability of progress in the fight to make marriage equality for gays and lesbians a reality. And they were good at learning and adapting rather than doubling down on something that wasn’t working.
Sylvia Yee of the Haas fund has described the collaborative’s iterative approach, recounting how efforts to influence public perceptions of gay marriage that emphasized “equal rights” were not working. “Messaging tended to highlight the many rights and benefits — including rights as basic as hospital visitation — that restrictions on marriage had denied to gay couples,” she wrote in the Stanford Social Innovation Review. A tide of state-approved bans on same-sex marriage “showed that this argument was falling flat with the public.”
The grant makers and nonprofits working on the issue could have stuck to their guns and their preconceived notions, disbelieving the research. Too often, that’s what happens. It is, for example, what some grant makers promoting incentive pay for teachers have done in the face of studies showing it doesn’t lead to the desired outcomes.
But Ms. Yee and her colleagues and collaborators swallowed their pride and recognized that to be effective, they needed to learn and adapt. They commissioned psychographic research that “explored what really goes on inside people’s minds when it comes to marriage equality,” Ms. Yee wrote. “On the basis of that research, my colleagues and I arrived at a crucial insight: When we straight people think about marriage, we don’t think about hospital visits or taxes or dental plans. We think about love, family, and commitment.”
So that’s what they emphasized going forward, and to great effect. They revised their strategy iteratively and got it right over time.
Maybe you’re thinking, What are you talking about? That kind of iteration of strategy happens in business all the time! That’s true, of course. But in business, the systems aren’t as complex. Feedback about what is and isn’t working is much easier to obtain, and more clear-cut. For foundations, it’s more complicated; it requires a different level of collaboration and a different kind of attention to learning.
Doing strategy well in philanthropy, as Ms. Yee has observed, also necessitates “putting egos aside,” something that doesn’t necessarily come naturally to foundation leaders. It requires patience, persistence, and a whole lot of listening: to grantees, to intended beneficiaries, to others in the communities and fields you hope to influence. That listening is vital because it informs the learning and iteration of strategy, but it’s also complicated by power dynamics that are unique to philanthropy.
So strategy in philanthropy is messy and difficult. Yet it is also absolutely vital. It is well past time that we recognize philanthropy has its own challenges and requires its own discipline when it comes to strategy. It’s not about foisting frameworks from business on philanthropy. But neither is it about rejecting something just because it has too often been done poorly. Long live strategy.
Phil Buchanan is president of the Center for Effective Philanthropy and a regular columnist for The Chronicle. Patti Patrizi is founder and chief executive of Patrizi Associates and founder and former director of the Evaluation Roundtable.
